Court Dismissal Of Foreclosure On Its Own – Again?

It continues to astonish how often courts will dismiss a foreclosure on their own (the legal term is “sua sponte”) based upon some perceived transgression or misconduct on the plaintiff’s part.  This occurs with enough regularity for it to find repeated examination in our alerts and the Appellate Division has commented upon this as well in a lengthy ruling exploring the history of such trial court miscues.

The essence of the problem is a court deciding that something which has occurred in a case is grounds to dismiss the foreclosure action which too often occurs without giving the plaintiff an opportunity to be heard on the subject. The most recent case, which gives rise to this discussion, is slightly different but is  nonetheless part of the pattern. [See HSBC Bank USA v. Assanah, 2025 WL 1242198, ____ N.Y.S.3d ____ (2d Dept.. 2025); for a further extensive discussion, with case citation of this subject  see Bergman On New York Mortgage Foreclosures, § 2.32, LexisNexis Matthew Bender (rev. 2026).]

The cited case started off innocuously enough, a status conference was being held, although precisely the stage of the case was unstated. The court had somehow concluded that the foreclosing plaintiff had unreasonably neglected to prosecute the action.  Accordingly, it issued a “conditional order of dismissal”, that is, it directed dismissal of the foreclosure action, in this instance unless the plaintiff filed a note of issue or otherwise proceeded to move for entry of judgment within ninety days of the date of the order.

This was all based on a section of New York’s practice statute (CPLR 3216) which does indeed provide for dismissal of a case when there is undue delay. However, that provision requires any number of conditions, not the least of which is the service of a written demand to resume prosecution within ninety days.  It is immediately noteworthy that the conditions imposed by this rule were not met.

The plaintiff did not comply with the court’s demands but nonetheless later moved to vacate the status conference dismissal order. While it does not usually happen in cases like these, where typically the offended plaintiff obtains reversal on appeal, it was the defendant who pursued the appeal because the court had seen the light and restored the action to the calendar. In affirming the restoration, and thereby supporting banishment of the sua sponte order, the appellate court initially stated the standard principle in cases of this nature, the first, that a court’s power to dismiss a complaint sua sponte is only to used sparingly and even then only when extraordinary circumstances exist to warrant such a dismissal.  In this case, failure to comply with the status conference order directive was ruled not sufficient ground to direct dismissal of the complaint.

Finally, the dismissal pursuant to CPLR R 3216 required statutory preconditions to set the procedure in motion. Those simply did not occur in this case and therefore the trial court was without power to direct dismissal of the complaint pursuant to that statute. Action revived!

Another success for the foreclosing plaintiff? Not really. Sua sponte dismissal imposes considerable time and expense in the foreclosure process. That the plaintiff will usually prevail on appeal in such cases is both welcome and appropriate, but it becomes somewhat of a pyrrhic victory given the time and expense suffered in the process.

Mr. Bergman, author of the four-volume treatise, Bergman on New York Mortgage Foreclosures, LexisNexis Matthew Bender (rev. 2024), is a partner with Berkman, Henoch, Peterson & Peddy, P.C. in Garden City, New York. He is also a member of the The American College of Real Estate Lawyers, a fellow of The American College of Mortgage Attorneys, an adviser to the New York Times on foreclosure issues and writes a regular servicing column for the New York Law Journal. He is AV rated by Martindale-Hubbell, his biography appears in Who’s Who In American Law and he has been for years listed in Best Lawyers In America and New York Super Lawyers.